Financial Data and Key Metrics Changes - Revenue increased by 44% year-over-year to $25.9 million, with 9% attributed to TVSquared following its acquisition [11][30] - Revenue excluding TVSquared grew 30% year-over-year to $23.4 million, surpassing expectations of 17% to 22% growth [12][31] - Net loss for Q1 2022 was $7.4 million, with adjusted EBITDA at negative $3 million, better than the expected range of negative $3.5 million to negative $4.5 million [12][39] Business Line Data and Key Metrics Changes - CTV revenue, excluding TVSquared, increased nearly 40% year-over-year, accounting for 47% of total quarterly revenue, up from 44% in Q1 2021 [13][31] - Mobile contributed 38% and desktop 15% of revenue, growing 23% and 20% year-over-year, respectively, when excluding TVSquared [31] - CTV accounted for 49% of all video impression volume served, up from 46% in Q1 2021, with a year-over-year growth of 36% [32] Market Data and Key Metrics Changes - U.S. revenue accounted for 90% of total revenue, growing 42% year-over-year, while international revenue grew 56% year-over-year [33][34] - The number of ad-supported streaming service users is projected to rise from 129 million in 2021 to 165 million by 2025 [9] Company Strategy and Development Direction - The acquisition of TVSquared aims to enhance measurement capabilities in the converged TV landscape, addressing the needs of marketers for robust measurement [14][15] - Innovid is focusing on volume growth, product upsell, geographic coverage, and client base retention and expansion as key growth drivers [20] - The company is optimistic about the future of advertising-supported CTV viewership and its market-leading infrastructure [29] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about recovery in the automotive sector and overall advertising spending, despite uncertainties in the macro environment [50][51] - The company expects revenue for Q2 2022 to be in the range of $33 million to $35 million, reflecting 44% to 53% year-over-year growth [42] - For the full year of 2022, total expected revenue is increased to a range of $135 million to $140 million, reflecting 50% to 55% year-over-year growth [44] Other Important Information - Gross profit for Q1 was $19.5 million, with gross margins at 75%, slightly down from 79% in Q1 2021 due to intangible asset amortization related to TVSquared [34][36] - The company has a cash balance of $45.4 million post-acquisition of TVSquared, down from $156.7 million at the end of 2021 [40] Q&A Session Summary Question: Impact of Ukraine invasion on guidance and CTV consumption - Management noted strong Q1 performance driven by recovery in the auto industry and CPG, with no specific delay in revenue driven by ad volume [49][50] Question: Measurement opportunities and competition - Management highlighted the significant investment in measurement and the unique position Innovid holds with its ad server and TVSquared's data [61][67] Question: IP address impact and litigation with Nielsen - Management stated that ongoing privacy changes have not materially impacted the business, and they do not expect the Nielsen lawsuit against TVSquared to be successful [71][75] Question: Political impact on revenue - Management indicated that political advertising is not a major focus, and any revenue from TVSquared related to performance tracking would not be significant [91][92] Question: Supply chain issues and recovery - Management observed a positive trend in the automotive sector, with spending returning to pre-supply chain issue levels [96][99] Question: Moving upmarket with TVSquared - Management confirmed the strategy to move upmarket by integrating TVSquared's capabilities with Innovid's existing offerings [102][106] Question: Netflix's AVOD ambitions - Management believes the introduction of ad-supported models by major streaming platforms aligns with Innovid's strategy and will drive investment in better ad products [110][111]
Innovid (CTV) - 2022 Q1 - Earnings Call Transcript